Boost­ing Pro­duc­tion: How Through­put Improve­ment Drove 16% Growth for Steel Manufacturer

INTRODUCTION

Organ­i­sa­tion design and through­put improve­ment are crit­i­cal suc­cess fac­tors for any man­u­fac­tur­ing indus­try. The effec­tive­ness of an organ­i­sa­tion’s struc­ture and process­es can deter­mine its effi­cien­cy, pro­duc­tiv­i­ty, and prof­itabil­i­ty. Through­put opti­miza­tion is essen­tial for steel man­u­fac­tur­ing. It helps to iden­ti­fy and address inef­fi­cien­cies in pro­duc­tion, main­te­nance, qual­i­ty, and plan­ning sys­tems, result­ing in increased effi­cien­cy, pro­duc­tiv­i­ty, and profitability.

Found­ed some 40 years ago, the Client is one of India’s lead­ing pro­duc­ers and sup­pli­ers of stainless-steel long prod­ucts. The group man­u­fac­tures and sup­plies hot rolled round bars, con­tin­u­ous cast billets/blooms, thread­ed bars, bright bars, forged bars and oth­er products.

It is one of the most tech­no­log­i­cal­ly advanced stainless-steel man­u­fac­tur­ing com­pa­nies in India with mul­ti­ple loca­tions and man­u­fac­tur­ing units. The com­pa­ny has a well-established foot­print in the Indi­an mar­ket and has a client base cov­er­ing mar­kets across Europe, Asia and North and South America.

THE CHALLENGE

The client was con­cerned with the lack of man­age­ment sys­tems at its pro­cess­ing unit and want­ed a more appro­pri­ate organ­i­sa­tion­al design. The main deliv­er­ables were to restruc­ture the organ­i­sa­tion and to improve the through­put by installing a new main­te­nance man­age­ment con­trol sys­tem (MCS) for the pro­duc­tion, plan­ning and main­te­nance functions.

ANALYSIS & PROJECT APPROACH

To meet the objec­tives of the assign­ment, it was impor­tant to inte­grate orga­ni­za­tion struc­tures, process­es, and peo­ple for the organ­i­sa­tion design and restruc­tur­ing, whilst the focus for the through­put improve­ment was on improv­ing the man­age­ment con­trol sys­tems by improv­ing their pro­duc­tion, main­te­nance and plan­ning systems.

Two Man­age­ment Action Teams (MATs) were formed from man­agers and super­vi­sors on a part-time basis, who met week­ly to review and under­stand the study find­ings, par­tic­i­pate in the devel­op­ment of solu­tions and to iden­ti­fy and mit­i­gate poten­tial busi­ness risks.

A Steer­ing Com­mit­tee was set up con­sist­ing of senior plant man­age­ment and board mem­bers. The Steer­ing Com­mit­tee met fort­night­ly to for­mal­ly approve To-Be struc­tures and solu­tions, pro­vide over­all direc­tion, mon­i­tor progress and address any bar­ri­ers to suc­cess that were beyond the scope of the Project Team and MATs.

“ The project helped us to assess and improve work­er pro­duc­tiv­i­ty, stream­line the struc­ture of man­age­r­i­al lay­ers and iden­ti­fy sys­temic inef­fi­cien­cies. This has been anoth­er suc­cess­ful engage­ment with Renoir help­ing us to achieve sig­nif­i­cant results. ”

Direc­tor

PROJECT IMPLEMENTATION

The Orga­ni­za­tion Design and Restruc­tur­ing work­stream stud­ied 1,000+ posi­tions involved in man­u­fac­tur­ing process­es asso­ci­at­ed at the com­pa­ny. To bet­ter under­stand the scope for improve­ment, the Project Team car­ried out detailed obser­va­tions of the activ­i­ties under­tak­en by shift work­ers and deter­mined the most appro­pri­ate orga­ni­za­tion struc­ture required to per­form these activ­i­ties in a depart­ment or subfunction.

For the man­age­r­i­al lay­er, we con­duct­ed inter­views and com­plet­ed obser­va­tion stud­ies to under­stand the activ­i­ties and process­es under­tak­en by super­vi­sors to arrive at the To-Be orga­ni­za­tion struc­ture with effi­cient spans of con­trol for the dif­fer­ent pro­duc­tion areas such as Draw­ing, Peel­ing, Pick­ling & Turn­ing, Main­te­nance and QC.

“The Project has been a great suc­cess. Renoir has helped us re-assess and re-evaluate our capac­i­ties. In addi­tion, Renoir’s approach act­ed as a cat­a­lyst to improve over­all health of busi­ness in a focussed and time­ly manner.”

Direc­tor

The Through­put Improve­ment work­stream was divid­ed into four phas­es of iden­ti­fy­ing oppor­tu­ni­ties, design­ing solu­tions, imple­ment­ing the changes and ensur­ing the changes were sus­tained. Pro­duc­tion, Main­te­nance, Qual­i­ty and Plan­ning were the main areas, and the team iden­ti­fied the gaps in their respec­tive process­es. An effec­tive man­age­ment sys­tem — with an empha­sis on short inter­val con­trol – was then designed and implemented.

The ini­tial phase involved map­ping the As-Is process­es and exist­ing man­age­ment sys­tems for the major process routes: Draw­ing, Peel­ing, Pick­ling and Turn­ing. It quick­ly became clear that process own­ers had a lim­it­ed under­stand­ing of machine capac­i­ties and that there was no for­mal struc­ture for monthly/weekly and dai­ly plan­ning. There­fore, machine stan­dards were set, and machine-wise dai­ly plan­ning and reviews initiated.

Main­te­nance man­age­ment con­trol sys­tem ele­ments were intro­duced, and ini­tia­tives under­tak­en to improve the qual­i­ty of incom­ing mate­ri­als. The next step was to con­nect the order plan­ning process with the pro­duc­tion plan­ning. The Month­ly Pro­duc­tion Plan­ning Process was start­ed based on pend­ing orders and work-in progress (WIP) / raw mate­r­i­al (RM) avail­abil­i­ty at both plants. Both WIP and RM were also seg­re­gat­ed at the plant for each of the areas based on shape, size, process stage and so on.

RESULTS